Henkel Roadshow Presentation. September 2018

Transcription

1 Henkel Roadshow Presentation September 2018

2 Disclaimer This information contains forward-looking statements which are based on current estimates and assumptions made by the corporate management of Henkel AG & Co. KGaA. Statements with respect to the future are characterized by the use of words such as expect, intend, plan, anticipate, believe, estimate, and similar terms. Such statements are not to be understood as in any way guaranteeing that those expectations will turn out to be accurate. Future performance and results actually achieved by Henkel AG & Co. KGaA and its affiliated companies depend on a number of risks and uncertainties and may therefore differ materially from the forward-looking statements. Many of these factors are outside Henkel s control and cannot be accurately estimated in advance, such as the future economic environment and the actions of competitors and others involved in the marketplace. Henkel neither plans nor undertakes to update any forward-looking statements. This document has been issued for information purposes only and is not intended to constitute an investment advice or an offer to sell, or a solicitation of an offer to buy, any securities. 2

3 Agenda 1. Strong foundation and consistent financial performance 2. Compelling ambition and clear strategy going forward 3. Consistent capital allocation supporting our ambition 4. Strong portfolio of three business units 5. Henkel a compelling investment 3

4 Henkel: Three areas of competence A global leader in brands and technologies Industrial Business Adhesive Technologies Beauty Care Consumer Business Laundry & Home Care Globally leading positions #1 Global #3 Hair Coloration #3 Hair Professional #3 Global #1 Europe, #2 North America 4

5 Well diversified and balanced portfolio Three business units operating across all regions Sales by business unit 1 Sales by region 1 Beauty Care 19% Africa/ Middle East 6% Latin America 6% Adhesive Technologies 47% Laundry & Home Care 33% Eastern Europe 14% Asia/ Pacific 17% Emerging Markets 40% Western Europe 30% North America 26% 1 Corporate sales not included (account for 1% of sales) 5

6 Strong and consistent performance Key financial developments Key developments Sustainable and profitable growth path Sales exceeding 20 bn with an average organic sales growth of 3.3% 1 Strong organic sales growth complemented by compelling acquisitions in all business units Continued improvement of Adj. EBIT Margin and new high in Adj. EBIT of 3.5 bn % 15.8% 14.1% % % % Sales bn Adj. EBIT % Adjusted EPS (preferred share) up by 9.1% to 5.85 in 2017, strong CAGR of 9.6% % +3.5% +3.4% +3.0% +3.1% +3.1% OSG %

7 Operating in a heterogeneous environment H key macroeconomic developments Strong industrial production 1 Moderate global GDP growth, continued strong IPX HPC markets mixed Persisting difficult conditions and ongoing competitive/pricing pressures Currency devaluation Strong headwinds from US Dollar and key Emerging Market currencies Commodity inflation Increased direct material price pressure including force majeures 1 Source: IHS Markit Henkel Roadshow Presentation September

8 Good profitable growth in H Sales Organic Growth 10.0 bn +2.3% Adjusted EBIT Adjusted EBIT % 1.8 bn 17.7% Adjusted EPS Growth +1.7% Good organic sales growth driven by very strong performance of Adhesive Technologies North American consumer goods businesses back to normal service levels Substantial FX- and direct material-headwinds on top and bottom line Continuous improvement in Adjusted EBIT Margin supported by synergies and Fund Growth initiatives Adjusted EPS above previous year Henkel Roadshow Presentation September

9 Emerging Markets driving growth H North America Western Europe Eastern Europe -0.9% +0.1% +7.9% 2,444 m (24%) 3,154 m (32%) 1,433 m (14%) Latin America Africa/Middle East Asia-Pacific +6.8% +6.7% +3.0% 581 m (6%) 642 m (6%) 1,661 m (17%) Emerging Markets: Mature Markets: +6.2% to 4,045 m, 41% of Group Sales -0.3% to 5,870 m OSG in % abs. in m (share of total) Henkel Roadshow Presentation September

10 Adhesive Technologies Key Financials 1-6/2018 Sales in m, OSG 1 in % +5.0% 4,665 4,702 Regional Performance Mature Markets: good, driven by North America Emerging Markets: significant, driven by Eastern Europe and Latin America EBIT Margin Adj. in % -10bp /17 x1 1-6/18 x2 1-6/17 x1 1-6/18 x2 1 Volume: 3.2% Price: 1.8% 10

11 Beauty Care Key Financials 1-6/2018 Sales in m, OSG 1 in % -2.0% 2,007 2,000 Regional Performance Mature Markets: negative, due to North America Emerging Markets: strong, driven by Middle East / Africa and Eastern Europe EBIT Margin Adj. in % +/- 0bp /17 x1 1-6/18 x2 1-6/17 x1 1-6/18 x2 1 Volume: -2.1% Price: 0.1% 11

12 Laundry & Home Care Key Financials 1-6/2018 Sales in m, OSG 1 in % Regional Performance EBIT Margin Adj. in % +1.1% +80bp 3,429 3,213 Mature Markets: slightly negative, due to North America Emerging Markets: very strong, driven by Middle East / Africa and Eastern Europe 1-6/17 x1 1-6/18 x2 1-6/17 x1 1-6/18 x2 1 Volume: 0.3% Price: 0.8% 12

13 Adjusted Gross Profit to Adjusted EBIT in % of sales Impact on Adjusted EBIT Margin in pp in H vs. PY 47.3% -0.5pp -23.0% +0.7pp -2.4% +/-0.0pp -4.5% +0.1pp +0.3% +/-0.0pp 17.7% +0.3pp Adjusted Gross Profit Marketing, selling & distribution R&D Admin OOI/OOE 842 m Adjusted EBIT 13

14 Strong FX-headwinds from EM Top 10 non- countries 1, Q2 FX depreciation 2 Key developments USA USA China Russia Mexico Turkey Poland S. Korea UK UK Japan UAE UAE -0.6% -1.1% -3.2% -1.7% -7.6% -5.8% -7.6% -11.7% -14.7% 1 in order of 2017 group revenue share 2 vs. Euro; Q2 avg. exchange rate vs. PY (Source: ECB) -24.6% Significant FX-headwinds of 7.4% on top line in H Almost 2/3 of absolute headwinds in Q2 from emerging market currencies Lower US-Dollar headwind in Q2 vs. Q1 Key emerging market currencies with high volatility and increasingly negative impact on results 14

15 Strong underlying results Substantial FX headwinds in the first six months 2018 Very strong organic & inorganic sales growth in m, changes in % Strong Adj. EPS growth before FX in per preferred share, changes in % -1.8% +1.7% 10, % +1.2% +1.1% +3.3% -7.4% 9, % -6.1% /17 Sales Volume Price M&A FX 1-6/18 Sales Adj. 1-6/17 EPS Organic Operational / anorganic FX 1-6/18 Sales Henkel Roadshow Presentation September

16 Net Working Capital above prior year in % of sales Adhesive Technologies Beauty Care Laundry & Home Care Henkel Group bps bps +80bps +110bps Net Working Capital of Adhesive Technologies impacted by acquisitions and temporary operational effects Increase in Beauty Care mostly driven by acquisitions Consumer goods businesses back to normal service levels in North America; Net Working Capital still impacted but recovering Q Q Henkel Roadshow Presentation September

17 Strong Free Cash Flow generation 1-6/2018 Free Cash Flow in m, PY in m Net Financial Position in m 1, Operating CF Investments CapEx Other Sales FCF -2,342-3,225-3, Despite technology investment, positive Free Cash Flow driven by operating improvement Net Financial Position below year-end following dividend pay-out, continuously strong balance sheet 1 Including technology investment of ca. 200 million in Q Henkel Roadshow Presentation September

18 Guidance 2018 Organic Sales Growth FY 2018 previously Henkel: 2-4% Adhesive Technologies: 2-4% Beauty Care: 0-2% Laundry & Home Care: 2-4% FY 2018 updated Henkel: 2-4% Adhesive Technologies: 4-5% Beauty Care: 0-2% Laundry & Home Care: 2-4% Adjusted EBIT Margin Improvement to a level above 17.5% Improvement to a level of around 18% Adjusted EPS Growth 5-8% Reflecting currency uncertainty 3-6% Reflecting currency development Henkel Roadshow Presentation September

19 Committed to driving profitable growth Build on strong momentum in Adhesive Technologies with continued price implementation Drive compelling innovations in Beauty Care and Laundry & Home Care Leverage full acquisition synergy potential Advance implementation of Fund Growth initiatives Intensify efforts to reduce Net Working Capital quarter by quarter 19

20 Agenda 1. Strong foundation and consistent financial performance 2. Compelling ambition and clear strategy going forward 3. Consistent capital allocation supporting our ambition 4. Strong portfolio of three business units 5. Henkel a compelling investment 20

21 We pursue a compelling ambition Generate profitable growth and attractive returns Become more customer-focused, innovative and agile Lead digital transformation in all business activities Promote sustainability across the entire value chain Advance our portfolio with value-adding acquisitions Clear and exciting growth strategy going forward 21

22 Financial ambition 2020 Organic Sales Growth Adjusted EPS Growth Adjusted EBIT Margin Free Cash Flow 2 4% (Average ) 7 9% (CAGR , per preferred share) Continued improvement in adjusted EBIT margin Continued focus on free cash flow expansion 22

23 Henkel Strategic Priorities 23

24 Drive Growth Initiatives Customer & Consumer Engagement Roadmaps expanded to top 500 industrial customers Leading Brands & Technologies Top brands Loctite, Schwarzkopf and Persil with above average growth in all three business units Exciting Innovations & Services >300 automotive applications in Adhesive Technologies, award winning IoT ecosystem in Hair Professional New Sources of Growth Since 2017 ~ 2 bn invested in 6 compelling acquisitions, committed more than 50 m VC investments

25 Accelerate Digitalization Initiatives Drive Digital Business Ongoing double-digit increase in digital sales, on track to achieve > 4 bn by 2020 Leverage Industry 4.0 Higher efficiency from real-time leverage of automation, sensorics, data exchange and analytics etransform Organization Gaining traction in transformation through dedicated digital functions and ecosystem including network of external partners

26 Increase Agility Initiatives Energized and Empowered Teams Direct communication strengthened through interactive exchange formats Fastest Time-to-Market Co-creating innovations with market leaders in Adhesive Technologies, acceleration of time-to-market of consumer goods innovations Smart Simplicity Seamless integration of >10 companies acquired since 2016 across all business units

27 Fund Growth Initiatives Most efficient structures Mastering growth through >130 robotic solutions and automated processes in Shared Service Centers ONE! Global Supply Chain Progressing roll-out leading to optimized cost, fully capturing cross-business synergies ONE!ViEW New level of cost transparency driving consequent optimization of non-personnel cost Net Revenue Management Global roll-out of systematic approach increasing efficiency of price and promotion activities

28 Fund Growth Implementation at full speed > 100 m efficiency gains in 2017 and accelerating Fully on track in the realization of efficiencies, contribution accelerating in 2018 > 500 m annual efficiency gains Expected sustainable annual efficiency gains in full swing by 2020 Re-invest in growth Fair share of annual efficiency gains are re-invested to support innovation and future growth

29 Henkel Clear, long-term strategy based on our values Sustainability 29

30 Sustainability Leading position further strengthened Performance recognized in ratings Leading positions in Sustainability Ratings, e.g. Oekom, Sustainalytics and included in relevant indices Broad engagement by our employees More than 50,000 trained sustainability ambassadors, commitment to sustainable action firmly anchored Achieve More with Less Strong performance Ecological footprint significantly enhanced, occupational safety improved

31 Improved sustainability along the value chain Key priorities Driving circular economy Sustainable palm material Transparent supply chains Climate protection 100% recyclability of packaging 1 and 35% recycled plastic 2 by 2025 Partnering with Plastic Bank for better recycling infrastructure By 2020: Cover 100% of our demand with Mass Balance certified oils 7 initiatives to support smallholders to increase supply of sustainable oil Initiative for transparency in global supply chains expanded >8,000 assessments and >1,000 audits done to ensure compliance Working towards a climate positive contribution Innovations: e.g. cold wash, lightweight, building insulation 1 Global 2 Europe 31

32 Agenda 1. Strong foundation and consistent financial performance 2. Compelling ambition and clear strategy going forward 3. Consistent capital allocation supporting our ambition 4. Strong portfolio of three business units 5. Henkel a compelling investment 32

33 Consistent capital allocation Strong sources of cash Excellent Free Cash Flow Balance sheet optionality 1. Investments 2. Acquisitions 3. Dividends 33

34 Strong FCF generation and balance sheet 2,023 1,616 1,333 Ø bn 1,690 2,205 1,701 Strong Free Cash Flow generation with average of 1.7 bn p.a. in period Continued focus on FCF expansion in strategic cycle , driven by operating performance, efficient capital management and disciplined CapEx Very robust balance sheet with equity ratio of 54% and net financial position of -3.6 bn as per Q Free Cash Flow in million 34

35 1. CapEx: Asset-light business model : 2.1 bn : ~ 3 bn Asset-light business model with low CapEx requirements, especially in Adhesive Technologies CapEx of around 3 bn planned in strategic cycle , ~40% up on previous cycle Significant investments to support growth initiatives, innovation, infrastructure and IT Stepping up investments in digitalization CapEx for existing operations in million 1 Full Year 2018 expectation incl. 200 m technology investment in Q

36 CapEx 1.1 bn invested in 2017 H Adhesive Technologies India: New multi-technology production site China: Continued capacity expansion Spain: New aerospace production site Beauty Care Russia: Plant upgrade & expansion USA: Body wash capacity expansion Mexico: Colorations capacity increase Laundry & Home Care Egypt: New laundry detergents production site Germany: Expansion of warehouse & logistic capacities USA: Expansion of detergent capsules production

37 2. Strong track record in value accretive M&A : ~ 6 bn ~ 8 bn invested since 2012 with projects evenly spread across business units 3,866 > 3 bn in annual sales 1 added across business units with substantial synergy potential 1,697 1,818 Adhesive Technologies focuses on complementary technologies, consumer businesses target leading country/category positions and white spots Acquisitions in million M&A remains integral part of strategy, complemented by selective VC investments 1 Sum of annualized sales contributions 37

38 Acquisitions ~ 2 bn invested in 2017 H Adhesive Technologies Complementary leading technologies of Darex Packaging strengthen position in metal packaging Beauty Care Hair Professional advances to #2 position in the US through Nattura Labs & Zotos acquisitions Laundry & Home Care Jempak complementing already leading North American Retailer Brand portfolio acquired with Sun

39 3. Continuously increasing dividend 25.6% % 30.0% 30.2% 30.3% 30.7% 1.22 CAGR % Consistent dividend policy based on strong earnings and cash flow profile Payout ratio within target range of 25-35% of adjusted net income after minorities More than 3 bn paid out to Henkel shareholders since 2012 via dividends Continuous increase of payout with 2017 dividend almost twice as high as Dividend per preferred share in, payout ratio in % 39

40 Consistent capital allocation Investments Acquisitions Dividends Asset-light business model with 2/3 of investments in growth CapEx ~40% up to around 3 bn in strategic cycle Strong track record in value accretive M&A and integration M&A remains integral part of Henkel s strategy Consistent dividend policy based on strong earnings and FCF profile Continuous increase of dividend pay-out in past years 40

41 Strong value creation EVA expansion driven by value-accretive M&A and strong operating performance 19.9% 22.6% 22.0% 20.1% 20.0% 18.3% Adj. Economic Value Added (EVA) increased by more than 60% to 2 bn in 2012 to 2017 period Expansion of Capital Employed mainly driven by accelerated M&A activity Strong focus on sustainable profitable growth and M&A integration with full realization of synergies Capital employed in bn Adj. EVA 1 in bn Adj. ROCE in % 1 Calculated based on Henkel Group WACC 41

42 Agenda 1. Strong foundation and consistent financial performance 2. Compelling ambition and clear strategy going forward 3. Consistent capital allocation supporting our ambition 4. Strong portfolio of three business units 5. Henkel a compelling investment 42

43 Adhesive Technologies

44 Adhesive Technologies Global leader in high-impact solutions in Adhesives, Sealants & Functional Coatings Industrial Consumer Packaging & Consumer Goods (32%) Transport & Metal (23%) General Industry (15%) Electronics (11%) Consumer, Craftsmen and Building (19%) Consumer goods, packaging, furniture Automotive, aerospace, metal industries Industrial manufacturing, maintenance & repair Electronic devices, consumer and industrial Building & construction, DIY, stationery, repair #1 #1 #1 #1 #3 Note: % share in 2017 business unit sales 44

45 Adhesive Technologies Proven track record of sustainable profitable growth Key developments Strong organic sales growth continuously outperforming industrial production Superior customer value and economies of scale Active portfolio management and disciplined capital allocation Continuous and sustainable margin improvement Profitable growth path % 18.5% 16.9% 17.2% 17.1% 15.1% +3.6% +2.7% +3.7% +2.4% +2.8% +5.0% Sales bn Adj. EBIT % OSG % 45

46 Market and competition Leading position through broad technology & product portfolio Global market leadership Strong performance Barriers to entry ~ 65 bn market OSG (%) IPX (%) Highly specialized and fragmented market with ~50 segments Henkel with ~14% global market share the only player present across all segments Industrial Production Index (IPX) as key market indicator Strong business performance with consistently good OSG over the past 6 years Global key accounts demand highest quality, performance and global presence Technology and application know-how 46

47 Key success factors for profitable growth High-impact solution provider Through customer proximity, broadest expertise and global scale >130,000 customers across broad range of industries Create value for our customers and establish trust Digitalize customer touch-points Develop innovations and customized solutions Broadest portfolio of 40 technologies & manufacturing network of 146 sites Bringing know-how to our customers with >6,500 customer-facing experts Truly global footprint, active in 172 countries Winning combination of best-inclass service & leading technologies Global R&D and manufacturing capabilities on all continents 47

48 Key success factors for profitable growth High-impact solution provider viaactiveportfoliomanagement 1 to resilient structures and superior pricing 1 5 business areas with 26 market focused steering units Ongoing optimization towards solution-oriented business model Broad geographical & industry coverage results in ~40% cyclical and ~60% non-cyclical business Flexible cost structures (e.g. SSC) according to market requirements High-impact solutions drive customers product performance but represent low share of cost Material cost increases are passed on to customers over time 1 Illustrative 48

49 Driving Growth Co-creating innovations with market leaders Mobility Sustainability Conscious lifestyle Connectivity Mass personalization Global coverage through state-ofthe-art innovation centers Industry trends Customized solutions Industry insights through strong and unique customer base Foundation People Technologies Applications Footprint Digitalization 49

50 Leveraging digital opportunities Annually already more than 1.5 bn digital sales Customer experience New business models & channels Efficiency through connectivity & automation Create unique competitive advantage through end-to-end customer experience Focus on value-adding customer interaction through digital customer touch-points Capture growth opportunities in new services and channels Create value through data-enabled service innovations, e.g. remote technical assistance Build a strong data-driven foundation to run the business Unprecedented knowledge of customers, industries, applications & technologies 50

51 Adhesive Technologies Global leader in high-impact solutions in Adhesives, Sealants & Functional Coatings Creating value through transformative solutions with high performance, but limited cost impact High-touch business model: >6,500 customer-facing experts working with >130,000 customers every day Growth and innovation driven by customer insights and global trends combined with unique technology portfolio Actively managed portfolio with broadest industry and geographical coverage and resilient structures Distinct entry barriers due to knowledge and customer proximity 51

52 Beauty Care

53 Beauty Care Focused portfolio with core competence in Hair Professional Retail Hair Professional 19% Hair Retail 51% Body Care 26% Skin / Oral 4% Salon, Color, Care, Styling Hair Color, Care, Styling Soaps, Shower, Deo Face, Mouthwash #3 globally #2 North America #1 Styling Europe #2 Coloration Europe #3 Personal Cleansing US Note: % share in 2017 business unit sales 53

54 Beauty Care Proven track record of sustainable profitable growth Key developments Profitable growth path Continuous organic expansion with strong focus on Hair & Body Care and Mature Markets Sales bn Growth through strong innovations and fast integration of value-adding acquisitions Adj. EBIT expansion driven by optimization and consolidation of structures 14.5% 15.0% 15.3% 15.9% 16.9% 17.2% Adj. EBIT % Clear ambition to accelerate top line growth going forward +3.1% +3.0% +2.0% +2.1% +2.1% +0.5% OSG % 54

55 Market and competition Attractive, dynamic and challenging Attractive market Consolidation & intense competition Channel shifts Largest non-food FMCG market with more than 400 bn Structurally high gross margins and premiumization opportunities Long-term growth dynamics, low cyclicality and seasonality Consolidation of retailers and manufacturers Increased price & promo pressure especially in mature markets Small challenger brands competing for shelf space and market share Growing share of digital investment and sales New online players (retailers and brands) ecommerce reducing offline basket & traffic Henkel Roadshow Presentation September

56 Key success factors for profitable growth Beauty Care as trusted partner Key competence in Hair and strong customer focus leveraging innovation power Schwarzkopf Hair mega-brand with > 2 bn annual sales Global #3 in Hair Professional thanks to strong base and successful M&A Top Retail positions in Europe Leveraging category leadership positions in brick & mortar and ecommerce Deepening partnerships through unique interactive customer experience center In-depth consumer insights & early identification of latest trends Leading, consumer-centric innovations Agile organizational setup with fast-track innovation process Henkel Roadshow Presentation September

57 Driving growth Acceleration of performance with strong innovation focus Strengthen core Expand core Innovations Rejuvenate brand equities and innovate on top trends Insight-driven innovation process & multi-channel communication Clear channel focus, best-in-class insights & strong customer proximity Top brands in new categories (e.g. got2b Color) and countries Further leverage Professional portfolio globally Step-change ecommerce in Retail and Professional Disruptive new brands, technologies and business models Enhance portfolio focusing on key trends Leverage synergies in Retail & Professional 57

58 Targeted innovations Translating trends into growth Better-for-you & Nature Millennials Male Grooming Personalization IoT / AI Product Innovations Direct-2-Consumer Services Apps & Smart Assistants Traditional business model New business model Henkel Roadshow Presentation September

59 Leveraging digital opportunities Double-digit increase in online sales in H New Business Models / Channels IoT / AI-powered Services Consumer Reach & Engagement Professional: First influencer brand #mydentity by Kenra Retail: First direct-to-consumer offer Schwarzkopf My Specialist SalonLab: Award winning IoT salon ecosystem for hair analytics and hyper-personalization Choicify: 1st digital Color POS advisor covering entire shelf Lever engagement with influencers (e.g. #SCHWARZKOPFcreators) In-house social media team & content factory to create real-time content 59

60 Beauty Care Strong brands and innovations Strong track record of profitable growth and leading positions in attractive markets worldwide Core competence in Hair Professional and Retail, Body Care as second pillar focusing on Europe and North America State-of-the-art consumer-centric innovations responding to relevant market trends Holistic Growth Acceleration Plan defined and in execution, leveraging strengths and digital opportunities Fast integration of value-adding acquisitions 60

61 Laundry & Home Care

62 Laundry & Home Care Focused portfolio of strong global and local brands Laundry Care (75%) Home Care (25%) Heavy Duty Detergents Laundry Specialties Dishwashing Home Care Specialties Premium, Mid-Tier, Value for Money Special Detergents, Fabric Finishers, Laundry Additives Hand Dishwashing Automatic Dishwashing Surface Cleaners, Toilet Care, Air Care & Insect Control #1 Europe #2 North America #3 Global Note: % share in 2017 business unit sales 62

63 Laundry & Home Care Proven track record of sustainable profitable growth Key developments Sales up 46%, thanks to very strong organic growth and transformational acquisitions Growth through successful innovations, market entries and new segments Adj. EBIT significantly improved by nearly +80% Substantial efficiency measures implemented to continue on profitable growth path Profitable growth path % 17.3% 17.6% 16.2% 15.6% 14.5% +4.7% +5.7% +4.6% +4.9% +4.7% +2.0% Sales bn Adj. EBIT % OSG % 63

64 Market and competition Dynamic market environment with intense competition Attractive market Competitive / pricing pressures Emerging digital channels Huge market of ~ 135 bn, growing but at a lower pace Potential to grow via penetration and consumption in EM and MM Innovations as strong lever to fuel growth Intense competition between global players; growing local players in EM High trade and promotion pressure in many countries Increase of discounters, smaller store formats and drugstores Online channels growing (>15% p.a.), but still small in our markets (~3%) Convergence of online and offline channels Industry transformation e.g. through services and advanced machines 64

65 Key success factors for profitable growth Moving ahead of competition Unique country/ category coverage with strong brands and agile & Glocal model Global Regional Unique coverage and in-depth knowledge of all major categories (11/12 categories of LHC market) Leading positions in active markets with >70 #1 positions globally Well-known and trusted brands with strong equity (Top 10: 52% of total sales in 2017) Unique position in growing retailer brands business in North America Local Platform innovations regionally adapted and locally implemented >130k shopper interviews in 32 countries to strengthen innovation power and customer relationships 65

66 Driving growth Strengthen leading positions and expand into new businesses Drive penetration and loyalty Strengthen footprint Innovations Educate, generate trial and initiate re-purchase Strengthen core and drive complementary categories via strong innovations Reinforce leadership in MM and strengthen positions in EM Smart entry into new geographies and white spots Enhance portfolio focusing on key trends Grow via expansion of laundry services as well as in digital / IoT 66

67 Targeted innovations Constant screening of six search fields to identify unmet consumer needs Simplicity Digitalization Urbanization, Health, Hygiene Sustainability Sensoriality Scientification Product Innovations Services & Co-operations Digitally Connected Products / IoT Apps & Smart Assistants Traditional business model New business model Henkel Roadshow Presentation September

68 Leveraging digital opportunities Double-digit increase in online sales in H Strategic customer collaboration Optimized portfolio & infrastructure Tailored digital content Strategic projects installed with Top digital customers eshopper-marketing expertise to optimize digital Point-of-Sales and consult trade Constant portfolio optimization with ebrands and eformats Global implementation and roll-out of esales tools Optimization of all digital touchpoints: from ad to purchase Development of ecommerce content, e.g. videos, pictures, descriptions Henkel Roadshow Presentation September

69 Laundry & Home Care Leading brands around the world Strong financial track record and clear initiatives for profitable growth going forward Challenging market environment, but major opportunities due to significant transformation Unique category / country coverage, strong brands and agile Glocal approach as key success factors Targeted innovations addressing strategic search fields to drive future growth Clear action plan to leverage digital opportunities 69

70 Agenda 1. Strong foundation and consistent financial performance 2. Compelling ambition and clear strategy going forward 3. Consistent capital allocation supporting our ambition 4. Strong portfolio of three business units 5. Henkel a compelling investment 70

71 Henkel a compelling investment Strong foundation based on a well-balanced portfolio with distinct competitive advantages Global leader in brands and technologies, leveraging growth opportunities in attractive markets Excellent and consistent financial performance Compelling ambition Henkel to deliver sustainable, attractive returns Clear and exciting growth strategy, based on our four strategic priorities 71

72 Back-up

73 Adaptation of our structures to the market in m 1, , Reported Reported EBIT EBIT 1-6/18 One-time gains One-time charges Restructuring charges charges Adjusted Adjusted EBIT EBIT 1-6/18 Focus of restructuring measures on go-to-market approach in key markets and optimizing structures Restructuring expenses of 200 to 250 million expected in FY

74 FY 2018: Additional input for selected KPIs Prices for Direct Materials Moderate increase vs. the level of the prior year Restructuring Charges m CapEx m 74

75 Adhesive Technologies Top Brands, Sales 2017 ~ 3.1 bn ~ 1.7 bn ~ 0.9 bn Top 10 brands: >80% of total Adhesive Technologies sales 75

76 Adhesive Technologies Key Competitors 76

77 Beauty Care Top Brands, Sales 2017 ~ 2.0 bn ~ 0.4 bn ~ 0.3 bn Top 10 brands: 90% of total Beauty Care sales 77

78 Beauty Care Large Customers 78

79 Beauty Care Main Competitors 79

80 Laundry & Home Care Top Brands, Sales 2017 ~ 1.3 bn ~ 0.4 bn ~ 0.4 bn Top 10 brands: 52% of total Laundry & Home Care sales 80

81 Laundry & Home Care Large Customers 81

82 Laundry & Home Care Main Competitors 82

83 Management Structure Henkel AG & Co. KGaA Henkel Management AG AG as sole personally liable partner Management of the businesses of Henkel AG & Co. KGaA Shareholders Committee (KGaA) Approval of significant corporate actions, strategy Appointment of Management Board (indirect via Supervisory Board AG) Supervisory Board (KGaA) Supervision of management Appointing the statutory auditor Annual General Meeting (KGaA) Approval of the financial statements Decision about the dividend 83

84 Management Board Hans Van Bylen Chief Executive Officer (CEO) Carsten Knobel Finance (CFO), Purchasing & IBS Kathrin Menges HR & Infrastructure Services Jan-Dirk Auris Adhesive Technologies Jens-Martin Schwärzler Beauty Care Bruno Piacenza Laundry & Home Care 84

85 Remuneration Structure Management Board Proportion if all performance targets are met in full 85

86 Upcoming Events November 15, 2018 February 21, 2019 April 8, 2019 Q Earnings Release FY 2018 Earnings Release Annual General Meeting 86

87 Contact Investor Relations Henkel AG & Co. KGaA Investor Relations Henkelstrasse Düsseldorf Germany Phone: Fax: From left to right: Lars Korinth, Mona Niermann, Andrea Haschke, Christopher Hüsgen, Ines Göldner, Steffen Nix 87